Charlize Theron wearing Chopard’s responsibly mined diamonds at Cannes

The new buzz phrase for business is “profit with purpose”. So how are leaders in the luxury and consumer industries facing the need to adapt to increasingly stringent sustainability criteria? Interviews by Ella Johnson and Candice Tucker

For brands, ensuring that consumer and luxury products comply with standards for Environmental, Sustainability and Governance (ESG) factors can be tough. How much water pollution do your steel suppliers create? What is the carbon footprint of your distributor in South America? How does the main supplier of your fasteners treat its staff?

These questions are becoming paramount for any company expecting to survive and thrive in the coming decades. Consumers are increasingly asking if products are sustainably created, if brands treat their staff and suppliers ethically. A company may still make profits on the back of a high-carbon footprint now, but it is far less likely to be able to do so in 10 or 20 years time.

We spoke to industry leaders across sectors for their insights into succeeding in a new era.

JEWELLERY
CAROLINE SCHEUFELE
Artistic director and co-president, Chopard
In 2013 Caroline Scheufele launched Chopard’s Journey to Sustainable Luxury, an in-house programme that committed the Swiss luxury jeweller to responsible sourcing. The brand has also forged a philanthropic relationship with the Alliance for Responsible Mining, helping gold-mining communities achieve Fairmined status.

LUX: Chopard’s engagement with ESG predates that of most jewellery houses. How did it start?
Caroline Scheufele: As a family-run business, ethics have always been at our heart. More than 40 years ago, my parents developed a vertically integrated in-house production system and invested in mastering all crafts internally. This means the full traceability of our gold supply chain is guaranteed through our operating model. It is based on a closed-loop system that also enables us to recycle pre-consumer gold scraps or “production waste” in our gold foundry.

LUX: How do you ensure responsible sourcing?
CS: In 2018 we became the first jewellery and watch maison to commit to using 100 per cent ethical gold for our watch and jewellery pieces. It is a bold commitment, but one we have to pursue if we are to make a difference to the lives of the people who make our work possible.

LUX: How does research help?
CS: Our R&D works to make our raw materials and production practices more sustainable. One example is the creation of ethically produced Lucent steel, which took four years research. It’s an alloy made from 70 per cent recycled metals and is 50 per cent harder than other steels. It also helps minimise our carbon footprint.

LUX: Does your model help or hinder creativity?
CS: Working with responsibly sourced material stimulates my creativity. The Insofu emerald, which we presented in Paris Haute Couture Week 2022, was discovered in the Kagem mine in Zambia and is one of the most important gems found for weight, quality and traceability. By buying a raw stone, we can follow its entire journey to final creation. Our craftspeople will cut the raw emerald and collect all the cut gems. We will then incorporate sustainability into our creations through eco-design thinking.

LUX: What does it mean for the future of luxury?
CS: True luxury comes only when you know the handprint of your supply chain.

chopard.com

AUTOMOTIVE
MARKUS SCHÄFER
Chief technology officer and member of the board of management, Mercedes-Benz Group AG

Mercedes-Benz’s Vision EQXX, its most energy- efficient car ever

Under Markus Schäfer, Mercedes-Benz has embarked on an electrification plan that will see battery electric vehicles (BEV) in every segment by the end of 2022, and an all-electric fleet by 2030. It is the first premium automobile manufacturer whose climate objectives have been verified by the Science Based Targets Initiative (SBTI) in line with the Paris Agreement.

LUX: What are the challenges of sustainability in the automotive sector?
Markus Schäfer: Our main ambition has always been to build the world’s most desirable cars. At the same time, our framework is changing dramatically, so we are rethinking our entire business model, with sustainability as our guiding principle. Our goal is to take the lead in electric driving and car software. And we will make our new car fleet CO2-neutral by 2039 – along the entire value chain and life cycle. It is a giant challenge, but for our brand it is also exciting.

LUX: Are luxury and sustainability compatible?
MS: Luxury has different meanings for everyone. In essence, it is simply about being completely at ease. Now it includes knowing your products and services helps reduce our footprint. For us, luxury is linked to setting new technological standards, and the age of sustainable and software-driven mobility gives us opportunities to do so. We think it will also make us interesting for new, younger customers who live a mindful-luxury lifestyle. At Mercedes-Benz, we want to combine our traditional strengths – innovation, safety, design, and comfort – with mobility that is sustainable and utterly intuitive. Luxury has always been a part of our DNA, and a driver of innovation.

LUX: If everyone moves towards electrification, what will differentiate your products?
MS: We think digital and sustainable innovations will be the top USP in luxury cars. With our Vision EQXX technology-programme prototype, we achieve more than 620 miles (1,000km) on a single battery charge. We are also increasing the use of recycled materials and researching new sustainable materials – we will use almost totally CO2-free steel in various models from 2025. With innovative car software we can offer customers the gift of time: we were the first car manufacturer to gain approval for conditionally automated Level 3 driving, without any safety compromises.

mercedes-benz.com

FASHION
MARIE-CLAIRE DAVEU
Chief sustainability officer, Kering

Kering’s Material Innovation Lab, the brand’s sustainable- materials hub in Milan

It was in 2011 under Marie-Claire Daveu that French luxury-goods group Kering introduced its innovative Environmental Profit & Loss (EP&L), an initiative to quantify environmental impact across the company’s operations and supply chains. It is now standard practice elsewhere.

LUX: Can collaboration help green transition?
Marie-Claire Daveu: Even a big company is not big enough to change a paradigm – it has to cross-fertilise with peers. For us, collaboration is in the DNA of our sustainability strategy. When we speak about sustainability, it includes being an open source and sharing our best practices. It is also about working with other sectors. It’s why we’re part of the One Planet Business for Biodiversity (OP2B) coalition, which includes food companies and the likes of Unilever. You may question why we have joined it, but regenerative agriculture is as important to us as it is to the food industry. Both of us take our raw materials from nature. We have the same origin.

LUX: Why did Kering invest in the vintage fashion platform Vestiaire Collective in 2021?
MCD: We were quite disruptive to go into vintage. It was our way of proving that purpose and profit go together. For us, it is interesting to have a seat on the Vestiaire board and see how we can develop a green e-commerce. There are new challenges with packaging, transportation and how we engage with customers. We are only at the beginning, but I think the idea of a second life will evolve in luxury and beyond.

LUX: Should leadership come from the top?
MCD: Sustainability is becoming more important to consumers and shareholders, but there is so much to do that, unless leaders prioritise it, you won’t do it. Luxury leaders must push for it both inside and outside their direct ecosystems.

LUX: Can fashion ever be sustainable?
MCD: You have to give people hope and solutions. I believe in a circular economy, upcycling, recycling – a 360 approach. With nature it’s about equilibrium. You have a problem if you take too much. But if you give nature the possibility to regenerate itself, there is no issue.

kering.com

TRAVEL
SVEN-OLOF LINDBLAD
Co-chair and founder, Lindblad Expeditions

A moment on Lindblad Expeditions’ Antarctic humpback observation trip

Sven-Olof Lindblad is an Ocean Elder whose work combines marine conservation, education and eco-tourism. Lindblad Expeditions has been at the forefront of environmentally sensitive expedition travel since its founding in 1979, raising more than $19m for conservation and scientific research and forming a strategic alliance with National Geographic.

LUX: Are there opportunities in sustainability?
Sven-Olof Lindblad: The more people think about sustainability, the more valuable the natural assets become that travel companies need to run their businesses. If you place more emphasis on protecting coral reefs, companies that want to incorporate coral reefs as part of their travel offering will have something that is more valuable and meaningful to travellers. But there are economic impacts to sustainability which makes things expensive. Some businesses don’t care enough yet because they think their audiences don’t, particularly in mass tourism where every dollar spent becomes significant. So companies have to believe, as I do, that sustainable behaviour is important, otherwise they are making decisions that, on the surface, do not make economic sense in the short term.

LUX: Do the wealthy have a responsibility to travel more responsibly?
SOL: I’m not that black and white. I might be sitting on my own private yacht now, but I’m on a research mission in Panama for a month interacting with Panama’s government to figure out how to evolve responsible tourism there. One of the most effective ways of doing that is by taking a boat, exploring the coastlines. Is that bad? I think it is using a boat to positive effect. There isn’t technology at the moment that allows us to eliminate burning carbon entirely, so we offset everything we do.

LUX: How do your expeditions ensure meaningful action in sustainability?
SOL: We take a lot of action in a variety of forms. We have a fund where we raise and distribute approximately $3m per year to conservation, activities, education and exploration. But it is also meaningful to engage people, making it possible for them to have experiences in the natural world that inspire them to think differently about natural assets. They can then change behaviours in their own lives or even create certain changes of action in their spheres of influence. That’s important, too.

world.expeditions.com

YACHTING
JAMIE EDMISTON
Chief executive, Edmiston; chair, Levidian
Yacht brokerage firm Edmiston has collaborated with climate-tech business Levidian to bring its LOOP decarbonisation technology to yachting. The device is expected to deliver significant benefits to battery technology, paints, coatings, and desalinisation systems in the maritime sector.

LUX: What are the biggest barriers to the decarbonisation of yachting?
Jamie Edmiston: Nearly all yachts burn diesel in their engines, so, until someone comes up with a suitable alternative engine, short-term innovations have to be in cleaning the emissions before they enter the atmosphere. Medium-term, we have to find other fuels than diesel, whether powered by battery or hydrogen.

LUX: How is Edmiston innovating in the sector?
JE: We have become involved with the climate-tech business Levidian, which has developed a LOOP device that takes methane, the main constituent of natural gas, and turns it into carbon, graphene and hydrogen. Around 40 per cent of the carbon is removed just by that one process, which means that all the gas being used is already decarbonised by 40 per cent. That makes a big impact. The LOOP device will not necessarily power a yacht, but the application we see is producing hydrogen at the source where it is needed. You can put that reactor in a factory, or a shipyard, where you’re taking methane and burning it, to decarbonise the gas that comes in. Moving hydrogen is complicated, but this way you can convert the natural gas into hydrogen at the source, where it is required, and then put it straight into whichever vehicle needs it.

LUX: How can yachting innovations benefit the maritime sector as a whole?
JE: Yacht owners are prepared to invest money, time and resources into developing new technologies – whether that be diesel- electric propulsion, or hydrogen-ethanol battery technology – within the maritime space, and this can ultimately find its way into commercial shipping. Yachting is the crucible of innovation for the maritime industry.

edmiston.com
levidian.com

SPIRITS
KIM MAROTTA
Global vice president of environmental sustainability, Beam Suntory

Pioneering low water-usage agave fields, for Beam Suntory tequila brands

In 2021 spirits behemoth Beam Suntory – which counts Courvoisier and Sipsmith among its repertoire – launched Proof Positive, a holistic, $1bn commitment to promoting positive endeavours in nature, consumer and community across its businesses.

LUX: Where do the challenges lie in decarbonising the spirits sector?
Kim Marotta: The main issues in the sector are in water, transport and packaging. Water presents an enormous opportunity for positive environmental impact, and we have established water sanctuaries in Kentucky at Maker’s Mark and Jim Beam. We’ve also set out an extensive programme of peatland water sanctuaries in the Scottish Highlands, not to mention our pioneering work in the tequila industry, where our Casa Sauza brand has the lowest carbon footprint and water usage. With transport, there is a fantastic opportunity for the sector to influence and partner with logistics groups to ensure everyone is working together for more sustainable methods of transport. Brands around the world are also looking at how to make their packaging more sustainable, whether that is in conducting a lifecycle analysis on every piece of packaging, as we are doing, or prioritising right weighting to minimise materials usage and waste, or even the total redesign of bottles, which we did this year with Courvoisier.

LUX: How can companies move their ESG agendas beyond reporting and compliance towards business enablement?
KM: Companies should not be afraid to set out the most ambitious targets they can, even if the specific road map isn’t totally clear. Whether they are unsure if the technology is there or what the commitment to R&D might be over the next few years, the solution is simple: set aggressive targets, make the necessary investments in technology to hit those targets and commit to accountability and transparency, showing evidence of progress along the way. If companies aren’t setting aggressive targets, they aren’t going to make the impact they can.

beamsuntory.com

CONSUMER GOODS
REBECCA MARMOT
Chief sustainability officer, Unilever
When consumer-goods giant Unilever introduced its Sustainable Living Plan in 2010, it became a benchmark for corporate sustainability. Under Rebecca Marmot, the company has also made interventions in the Paris Agreement and in the creation of the UN Sustainable Development Goals.

LUX: What is essential to the success of a company’s ESG agenda?
Rebecca Marmot: Success relies on everyone being on board. We need to draw on the ingenuity and experience of experts and peers across the globe to meet our sustainability targets. We know that pioneering new practices requires partnership, so we also need to shun silos in favour of systems thinking. For example, at Unilever we take a holistic approach across both climate and nature, because we recognise that action to solve one crisis can help to address the other.

LUX: How is Unilever working to eliminate Scope 1 and 2 emissions – those generated by your operations?
RM: One of our biggest challenges is that the lion’s share of our emissions are outside our direct control. About 60 per cent come from raw materials and packaging. To reach our target, we are working across our value chain and engaging suppliers, partners and consumers in our decarbonisation journey. We can’t control how long consumers spend in the shower or how they source their energy, but we know consumers do increasingly want to align their purchasing power with their values. We want to make it easy for them to choose our trusted brands, knowing that they are made with respect for people and the planet.

LUX: Is there a risk that those who are last to take on the costs of a green transition will be winners in the short term?
RM: Without action to make supply chains sustainable, companies won’t be able to source the raw materials they need, and operations will be stalled by floods and extreme weather. Laggards will also be hit by taxes on carbon and virgin plastic – these are coming down the line.

unilever.com

CLIMATE TECHNOLOGY
HEATHER CLANCY
Editorial director, Greenbiz; co-host, Greenbiz 350 podcast
GreenBiz 350 is a weekly podcast delivering stories on sustainable business and climate tech. Co-host Heather Clancy specialises in chronicling the role of technology in enabling corporate climate action and the transition to a clean, inclusive and regenerative economy.

LUX: How should companies be balancing the ‘E’ and ‘S’ of ESG?
Heather Clancy: Corporations are not spending enough time thinking about how environmental justice is embedded into their corporate sustainability strategies. There is still a huge disconnect between a company’s corporate perception of what environmental justice means and how it acts as a business.

LUX: What role can early-stage climate tech play in decarbonisation?
HC: Small, innovative companies have the opportunity to really innovate and become the new suppliers for larger companies – for example by producing alternative materials, such as mushroom-based packaging to replace plastic or Styrofoam. It is not coincidental that there are so many corporate venture funds now that are focused on climate technologies, because these corporations are going to benefit from that innovation when the company goes public down the line. The digitisation of sustainability is also really important, because it is becoming part of the financial infrastructure of the companies themselves. These kinds of tools can help people make investments in other climate technologies more easily.

LUX: What’s the biggest barrier to scaling up climate technology?
HC: If there’s one thing that we really are lacking from corporations, it is their voice on supporting sustainable policy.

LUX: What should the wealthy be doing?
HC: They should model better behaviour and put their money where it counts. The wealthy can help small businesses get on the ESG bandwagon, for example. Buying from these companies will enable them to make the vital shift to greener practices.

greenbiz.com

Land Acquisition – Once the fragmented lands are connected, APR will provide overall wildlife management focus

Sean Gerrity has a vision, which he is rapidly turning into reality. Through the American Prairie Reserve, of which he is president, he is creating a wilderness reserve in North America to rival the Serengeti. Darius Sanai tells the story; and over the next pages, the images of the reserve in Montana tell their own 

“In 10 to 15 years, you should see a slice of land extending 13,000 square kilometres here, the vast majority of that with no fences. There will be stunning variety of wildlife that has not been seen here for 150 years, but which was here for 1,000 years or more: thousands of bison, like the wildebeest in the Serengeti; cougars, wolves, grizzly bears in sustainable numbers. There will be all species of prey like elk and deer. It will be very easy to engage with this space: it will be a very wild place but with planned, controlled public access.”

Sean Gerrity – An ex-entrepreneur, Gerrity now commits himself to wildlife preservation

Sean Gerrity is mapping out his vision for the American Prairie Reserve (APR) on the high plateau of Montana. The idea of a kind of vast safari reserve in what has, in recent times, been farmland may sound far-fetched, but Gerrity is no empty dreamer. In his role at the APR, he has already been building the project for 15 years, purchasing and piecing together ranches and farms from owners who are giving up on farming. “Their kids want to go live in the cities and become web designers,” he says, commenting on the decline of the ranching tradition. Rather than let the area become forgotten, he and the APR are building America’s largest wilderness reserve and restocking it with species, many now endangered, that used to roam freely.

Gerrity and the APR work closely with conservation bodies like the International Union for the Conservation of Nature (IUCN) and Worldwide Fund for Nature (WWF). The most compelling part of his vision is that he wants to build facilities for humans to come and interact and experience and enjoy the wilderness, without destroying it. “It’s a life-producing experience being out there, quite overwhelming,” he says. “All five senses are just roaring. We are building a way for people to access it, for kids to come out and just sit and listen to the sounds and forget about their electronic toys.”

Gerrity knows about the latter: in his previous life, he was a Silicon Valley entrepreneur, founder of a consulting company. He has now returned to his childhood home of Montana and is bringing nature back where it belongs, as the photography on these pages shows.

americanprairie.org

Prairie Heritage – Reintroduced to the prairie in 2005, the bison herd has since grown in numbers

Buffalo Watch – An American West icon, APR seeks to restore the majestic bisons in their natural habitat

The Great Outdoors – Visitors can explore the vastness of the landscape by hiking or even biking

Kestrel Camp – Located on-site, the climatecontrolled tent suites offer an intimate nature experience 5. Western Meadowlark The reserve

Pronghorn Antelopes – One of the few remaining native animals, the migration studies contribute to meaningful research

Nurturing Offspring – Numerous bison calves have been born on-site since the reintroduction of the species

Green Carpet Challenge – The brainchild of Firth has seen strong support from high-profile actresses

What are the greatest challenges Eco-Age faces moving forward?

Each business we work with involves a different challenge. But this is what we do – we help companies undertake what could seem like a huge challenge and make it easy for them! Until last year no one would have thought it possible to connect a Gucci handbag with the cows in the Amazonian forest, and yet we made it happen. Or Chopard’s stunning earrings with the miners who dig out the gold in Colombia. These are processes which take time, but as Caroline Scheufele of Chopard always says, “Rome was not built in a day”!

Rodriguez & Bottletop – The bags are made from deforestation-free leather and recycled aluminium pull tabs

What are the rewards?

Huge. Both economic rewards (to be a sustainable business means precisely this – to save money and become more agile) and social rewards – we all need to reconnect with the people at the beginning of the supply chain. This is what we strive to do at Eco-Age: help brands and businesses to establish this powerful connection.

How are businesses responding and adapting to sustainability challenges?

They are all trying to figure it out, but most importantly they all acknowledge we need to change. This is the first step to change. It is about future proofing a business, securing long term supply of consistent resources, both natural and human, and continually ensuring consumers that when they buy what you are selling, they are making a positive impact.

When clients come to us, we try to help them meet their sustainability challenges and then benefit from those improvements through business efficiency, secure supply chains, reputational benefits and ultimately, increased sales.”

eco-age.com

Campaign Ambassador – Supermodel Candice Swanepoel (left) is the face of the Rodriguez collaboration

GCC Brandmark – Narciso Rodriguez worked with Bottletop Foundation on an eco-friendly range of bags

Industry Support – Firth’s work is backed by industry heavyweights such as US Vogue Editor-in-Chief
Anna Wintour

The head of future mobility at the world’s leading luxury car manufacturer predicts that the transformation of the auto market will come slowly, but surely. Herbert Kohler

As a company, as announced a few years ago, we are preparing the platforms of our cars to adapt to hybridisation [the use of electric and combustion engines in the same car]. We have done this with very good results in the [mid-sized] E-Class, but we have to admit that the market has changed a little since: hybrids are not the only way to dramatically reduce CO₂ emissions anymore. Look at the [big SUV] M-Class and you can see that a [diesel] combustion engine by itself can reach emission rates lower than 160g CO₂/km, which is outstandingly good. Nobody would have imagined that three or four years ago.

Still, the latest development is plug-in hybrid technology [where the electric engine is powered by batteries charged by mains electricity] with the S-Class, with preparations taking place to use the technology in other cars in the future. However, that depends on market acceptance, and nobody can realistically claim to predict that. The technology is fantastic and outstanding in terms of the technical challenge and solution; there is no question about that.

But the question is: how does this technology fit in and work from the market side, from the consumers’ side? And there is not only one market. There are different markets – China, the rest of Asia, Europe, the US and the rest of the world. It will come step by step and we are all feeling our way.

There are different opinions in the market. On the one side, you have the consumers who love such developments and are more passionate and committed to sustainability. Others do not care about that sort of thing, or not that extensively. And most people have no clear idea of the technology involved. In itself, this is not a disaster. But there is a tendency to associate with the word ‘hybrid’ – that this means the car has less emissions, that it is cheap but with as good a performance as before, and that there are no restrictions in the package. Most people would like to have all that without the additional costs – it’s a very attractive idea.

An important point to make is that [car manufacturers] cannot survive solely on the purchases of those who are really committed, on the consumers who say, “I really want to have that technology, and I will bear the extra costs because I know it is a positive thing to do”. I would say that they are less than five per cent of the market. You cannot build a business on less than five per cent.

There is a global move towards reducing emissions. China and Japan are in the same situation as Europe and the US. If you sum up the volumes of these countries, it adds up to more than 50 per cent of the world market, so it is clear we have to be guided by that. And then there’s the requirement for high technology and specification, from the Middle East, for instance, and such markets might not be as interested in the consumption side.

It is not possible to predict the future with certainty, as we all know. But we think there is strong movement behind plug-in hybrid motoring technology. I remember seven or eight years ago, when the first realistic ideas were being aired about plug-in hybrids. The initiative actually came from our Van department. Due to some requirements in the US, they asked if we were planning to do a plug-in hybrid. Our response at that time was, “Is this really necessary?”

My reason for recounting this is that there is a lot of development going on and there are a lot of new ideas, so it’s very difficult to say today what will happen in the next 10 years. I do think we will have more plug-ins in the future, because we’ve got good technical solutions without the compromise of additional costs or the lack of driveability. Nobody would want a luxury hybrid car with an electric mode that drives very slowly; nobody would pay for that. We are convinced that the time will come for [hydrogen] fuel cell and hybrid cars and that will bring us additional momentum, not being appropriate at the moment for the entire portfolio. But certainly [compact cars] will go in that direction for the next generation, and it will conquer other segments step by step. The technology is a given, we can do it, but it is also important not to swallow too much from the beginning. We need to do it step by step.

Our biggest challenge in all this is infrastructure [the network of electrical charging points for plug-in cars, which is mostly incomplete or non-existent around the world]. We will not get involved with it because it is not our core business and we are not willing to compete against energy suppliers – that would not make sense for us. We therefore have to rely on those who are more interested in it to grow in that direction. And sometimes there aren’t enough companies who wish to develop in that direction, so there is always an intensive struggle behind the curtain about that. This is one of the biggest challenges, but of course we also have a lot of technical challenges, as with any new technology. On the engineering side we have developed a very good cooperation with Nissan and Ford.

To showcase our technologies on this front is the S-Class [the new large saloon launched at the end of last year] for several reasons: it has autonomous and semi-autonomous driving modes, the most advanced safety features, and a plug-in hybrid solution. It shows everything we can do right now.

Professor Herbert Kohler is Chief Environmental Officer of Daimler AG, parent company of Mercedes-Benz; mercedes-benz.com